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Medicare Advantage Plans
What is Medicare Part C?
If you qualify for or already have Original Medicare, you can choose to instead enroll in a Medicare Advantage Plan from a qualified private health insurance company. You would never need all three. You also have no need for a Medigap policy if you enroll in a Medicare Advantage Plan.
A Medicare Advantage Plan generally covers everything that Original Medicare covers, but with some differences. Those differences can be in how much you pay out of your own pocket when you receive health care. For example, you might have lower copays or a smaller deductible, or you might pay a different percent share of the bill (coinsurance).
All Medicare Part C coverage includes emergency and urgent care. Some plans may even include routine vision, routine dental and/or wellness programs. Most include prescription drug coverage under Medicare Part D. Medicare Part C coverage does not include hospice care; that benefit remains with Original Medicare even if you have a Medicare Advantage Plan.
Types of Medicare Advantage (Part C) Plans
It's important to review the differences between the types of plans to see which works best for you. There are several different types of Medicare Advantage Plans:
- HMO (Health Maintenance Organization Plan) - allows you to see doctors and other health professionals that participate in its network. If your doctor is already in that network, it could be a good option because you tend to pay less out of your own pocket with network doctors.
- PPO (Preferred Provider Organization Plan) - gives you the freedom to choose any doctor, which can work for you if you prefer that kind of flexibility.
- PFFS (Private Fee-for-Service Plan) - pays a specific amount for health care services and the treating doctor has to accept that amount - even if it is less than his or her usual charge. If the doctor does not agree to those terms, then Medicare will not cover services through that doctor.
- SNP (Special Needs Plans) - is especially for people who have - as its name implies - special needs. That includes (but is not limited to) those living in a nursing home, Medicaid-eligible individuals, and people with chronic diseases or disabling conditions, like diabetes, ESRD or HIV/AIDS. This type of plan always includes prescription drug coverage while other types of plans may or may not.
- POS (Point of Service Plan) - covers both in- and out-of-network health services, but at different rates. You pay less out of pocket when you go to in-network doctors, labs, hospitals and other health care providers.
- MSA (Medical Savings Account Plan) - includes both a high deductible and a bank account to help you pay that deductible. The amount deposited into the account varies from plan to plan. The money is tax free as long as you use it on IRS-qualified medical expenses, which includes the health plan's deductible.
Eligibility for Medicare Part C
Medicare Part C eligibility is based on your membership in or eligibility for Medicare Parts A and B (except if you have End Stage Renal Disease (ESRD)). Generally, if you have Medicare Parts A and B, you are eligible for Medicare Part C. However, you must live in the service area for the Medicare Advantage Plan that you're considering. The service areas may be more limited than Original Medicare.
If you have other health insurance coverage, for example through an employer or union, find out their rules before you enroll in a Medicare Advantage Plan. You may lose your other coverage if you enroll in the Medicare Advantage Plan. But that's not a hard and fast rule. It's best to talk it over with the other plan's benefits administrator. If you drop the other plan, you might not be able to get it back if you change your mind later.
Enrollment in Medicare Part C
Medicare Part C enrollment processes differ depending on which private insurer you chose. But the enrollment periods are the same everywhere. You can enroll in a Medicare Advantage Plan (Part C) when you first become eligible for Medicare. It's a seven-month period that starts three months before your 65th birthday through four months after your birthday. If you are under age 65 and you receive Social Security disability, you qualify in the 25th month after you begin receiving your Social Security benefits.
If you are already enrolled in Original Medicare, then you must wait until the next enrollment period to sign up for Medicare Advantage. The annual enrollment period is October 15 through December 7 Coverage begins on January 1 of the new year.
If, after enrolling in a Medicare Advantage Plan, you change your mind, you can switch back to Original Medicare from January 1 through February 14 each year. If you would be losing prescription coverage as a result of the switch, you can also sign up for Medicare Part D during this time.
Generally, once you enroll, you stay enrolled until the next annual election period becomes available. However, there are some situations that might qualify you to make a change during the rest of the year. An example of the situations include(this is not an all inclusive list):
- You move outside your Medicare Advantage Plan's service area
- You qualify for Extra Help (a program to help you afford prescription drugs)
- If you move into an institution (such as a nursing home)